SECTION 8 COMPANY

If you want to create a company where profit takes a backseat and purpose drives the mission, a Section 8 Company is your best choice. Under the Companies Act, 2013, a Section 8 Company is a special non-profit entity established to promote social causes like education, healthcare, charity, environmental sustainability, and more.

Unlike regular companies, a Section 8 Company does not distribute profits to its members. Instead, all surplus income is reinvested into achieving its objectives, ensuring credibility and government recognition for your cause.

At Aarthika Globcorp Solutions, we help you register a Section 8 Company in India hassle-free, ensuring complete compliance with legal requirements and faster processing.

Documents Required

1. Director & Shareholder Documents

2. Registered Office Documents

3. Other Documents:

PAN Card (mandatory)
Aadhaar Card / Passport / Voter ID / Driving License
Passport-size photo
Residential proof

Rent Agreement / Lease Agreement
NOC from owner
Utility bill

Application for License under Section 8 through INC-12.
Declaration by each subscriber through Form INC-15.
Declaration of objectives through Form INC-12.
Declaration by subscribers and first directors (Form INC-9).
Declaration by a professional (CA/CS/CMA) through Form INC-14.

Registration Process

Obtain DSC
Apply for DIN
Application for name availability in form RUN
Apply for Section 8 License (Form INC-12)
File SPICe+ Part B for Incorporation
Apply for 12A & 80G for income tax exemption (Optional)

FAQs

Any Section 8 Company intending to receive foreign contributions (donations from outside India) must obtain registration or prior permission under the Foreign Contribution (Regulation) Act, 2010 (FCRA). This is a mandatory requirement and applies to all NGOs—Trusts, Societies, and Section 8 Companies.

Conversion is possible but involves a structured process. The NGO must pass a special resolution, seek member approvals, reserve a name, and meet eligibility criteria. Compliance failures or having more than 200 members may prevent direct conversion.

The section 8 company incorporates under the Companies Act, trust registers under the Trust Act and society registers under the Societies Act having different governance and compliance policy.

Yes, conversion is permitted but subject to compliance with specific procedures under the Companies Act and various prescribed conditions. Approval from authorities and adherence to statutory rules are mandatory before such conversion can happen.

Section 8 Companies are strictly prohibited from issuing shares (equity or preference), paying dividends, or distributing profits to members. All income/profits must be used strictly for the company’s charitable objectives.

Donors can only claim tax deductions after the Section 8 Company obtains 80G registration from the Income Tax authorities. This is a separate application, and approval is discretionary. Only then contributions are tax deductible for donor.

Any alteration to the objects requires prior approval from the Central Government. Changes must align with the principles of Section 8, and any deviation or unauthorized change can lead to penalties or revocation of license.

The license can be revoked under Section 8(6) of the Companies Act, 2013, and the company may be converted into a normal company by MCA or Penalized (fine up to ₹10 lakh or imprisonment for officers) or Dissolved, with assets transferred to another NGO or government body.

Section 8 Companies can apply for registration under Section 12A for income tax exemption. 80G registration must also be separately applied for, post incorporation, to make donations tax-deductible for the donor.

Revocation can occur if, the company violates its non-profit objectives and profits are misused or distributed. If false information was submitted or Company becomes inactive and fails in compliance then, Revocation is done by the Regional Director (MCA) under Section 8(6).